A jury returned a verdict finding that LG infringed the claims of the patent-in-suit and that the claims were not invalid. The jury also found that the infringement was willful. As a result, the district court determined whether enhanced damages were appropriate under 35 U.S.C. § 284.

As explained by the district court, "Section 284 allows district courts to punish the full range of culpable behavior. Accordingly, the degree of enhancement should be proportional to the degree of the willful infringer's culpability. An enhancement of treble damages may be appropriate to penalize the most egregious conduct. A less significant enhancement may be appropriate for less egregious (though still culpable) conduct. The Court also has the latitude not to enhance even if willfulness is found, where the degree of culpability is de minimis. The particular circumstances of each case must dictate the degree of enhancement."

In determining whether the damages should be enhanced, the district court noted that "LG had detailed knowledge of the patents-in-suit long before the filing of this lawsuit. Throughout the course of the licensing negotiations Core Wireless provided LG with claim charts that set forth detailed infringement contentions. Core Wireless specifically demonstrated how LG infringes Claim 21 of the '850 Patent--a claim that the jury unanimously determined to be infringed by LG. The mere fact that LG was able to muster a non-infringement position during negotiations and at trial does not necessarily insulate it from enhanced damages. Moreover, its invalidity defense, which was asserted at trial but rejected by the jury, is belied by the admission of LG's corporate representative, Seung June Yi, who testified at his deposition that after thorough review of the patents-in-suit he concluded that the patents are novel and non-obvious."

The district court also found it particularly significant "the manner in which LG abruptly terminated licensing negotiations." The district court revealed that "[a]fter a long series of meetings between the parties, including seven meetings in Seoul, Korea, LG invited the Core Wireless representatives to Korea one last time and indicated that it would be making a monetary offer for a license. Rather than make an offer or engage in serious, good faith negotiations, LG delivered a terse one-page presentation stating that a lawsuit at that time between the parties was 'preferable' to a license, and that LG would prefer to wait until another major cell phone manufacturer licensed the portfolio, at which point LG intended to be 'a follower' in the established royalty scheme. This should have been done by email. LG's conduct in making Core Wireless send representatives to Korea to be handed a one-page document like this is clearly within totality of the circumstances which the Court should properly consider."

From these facts, the district court determined "that LG's decision to terminate negotiations and continue operations without a license was driven by its resistance to being the first in the industry to take a license, and not by the merits or strength of its non-infringement and invalidity defenses."

Accordingly, the district court granted enhanced damages in favor of Core Wireless.

Core Wireless Licensing v. LG Electronics, Inc., Case No. 2:14-cv-912-JRG (E.D. Tex. Nov. 2016)